3 Comments:

Thought provoking stuff as usual. The problem I see with this post is we can't distinguish between growth due to wage increases (to be expected over time) and growth in employment levels.

If we assumed employment levels were relatively constant the cost increase should be due to wage increases. From 81-91 the cost increase was nearly linear, then dipped during the lean years of the 90's. If we extrapolate directly from that first decade the total current cost of the public sector is still well below where it would have been. To me either the public sector has shrunk from 80's employment levels or wage growth hasn't kept up. Whether this is good or bad I'll leave up to the reader...

I'd like to see a similar chart using something like the wages/employee as the measure, in comparison to inflation. That in conjunction with your original graph should help determine if the problem is wage growth or growth in employment levels.

Transparency and accountability disclaimer: My wife and I are public sector employees and I am an active union member so I'm likely to have certain biases :-) That said I'm also a parent of a young child and concerned citizen so I am realistic (hopefully) about what is sustainable for the province financially.

The problem I see with this post is we can't distinguish between growth due to wage increases (to be expected over time) and growth in employment levels.

Don't get ahead of me! :)

Hopefully I'm not self-scooping too much by telling you that the provincial public-sector labour force is 8% higher now than it was in 2002 (40% over 1981); while the payroll is up 31% (255% since 1981); and the payroll/employee is up 23% (153% since 1981).